BSC gets VAT waiver on import of 6 oceangoing vessels

BSC gets VAT waiver on import of 6 oceangoing vessels

National Board of Revenue has exempted Bangladesh Shipping Corporation from paying value-added tax on import of six oceangoing vessels from China.

VAT wing of NBR on Monday issued six separate letters to BSC conveying its decision.

BSC is procuring six new ships having capacity around 39,000 deadweight tonnages each. The state-owned corporation included new ship in its fleet 27 years before.

Chinese Yangzi Shipbuilding Co Ltd has already delivered two ships to BSC in July and October respectively, while the rest four ships will arrive in November, December and February, officials concerned said.

VAT officials said that BSC would enjoy VAT exemption worth around Tk 400 crore due to the benefit offered by NBR under a general order.

NBR in June this year waived 15 per cent VAT on import of up to 22-year old oceangoing vessels on some conditions including hiring at least 70 per cent of Bangladeshi nationals for the vessel and operating it at least five years as national flag carrier.

They said that NBR gave the waiver to BSC to help the sector flourish and increase foreign currency earnings.

There is huge potential for the sector in carrying the lion share of country’s import goods worth around $50 billion, they said, adding that there was an international convention of allowing national carriers to carry 50 per cent of import goods.

But the country’s shipping operators both from private and public sectors are currently cannot tap the potential due to a shortage of oceangoing vessels.

The number of ships of BSC has been declining over the last few years and stood at only two in last year from that of 11 in 2013.
Earlier, BSC had 38 national flag carrier oceangoing vessels but it sold most of those due to incurring losses.

In this context, the government is procuring the six ships — three oil tankers and three bulk carriers — under a government-to-government agreement at the cost of Tk 1,843 crore.